Governor, lawmakers strike budget deal on eve of veto session

MONTPELIER — Gov. Phil Scott and legislative leaders struck a deal Tuesday to end a month-long impasse on the state budget and property tax bills as rank-and-file lawmakers prepared to return to the State House for a veto session Wednesday.

The breakthrough on the eve of the veto session should pave the way for a relatively smooth process Wednesday. House Speaker Mitzi Johnson, D-South Hero, said a new budget was being drafted and would likely be distributed to all rank-and-file members of the Legislature Tuesday night.

House Speaker Mitzi Johnson, D-South Hero, speaks to reporters Tuesday about negotiations with Gov. Phil Scott ahead of Wednesday\’s veto session. (VPB/Neal Goswami)

“I feel like we have a strong compromise that … everybody will be able to say yes to. I think, conceptually, we’re agreed to stuff, which is a huge step forward from yesterday,” she told reporters Tuesday afternoon.

Johnson and other lawmakers declined to share details of the agreement until legislative staff had completed drafting the new bill.

“We’re trying to actually get the draft. We’ve agreed to the concepts,” Johnson said. “We want to make sure that the drafting works and that we’re agreed on the implementation of some of the concepts, that in broad strokes, we’ve agreed to.”

Johnson, Senate President Pro Tem Tim Ashe, D-Chittenden, and the governor’s office were working on a joint statement outlining details of the agreement Tuesday afternoon.

Scott, a first-term Republican, fulfilled his promise to veto both the budget and what’s known as the yield bill in early June because they did not account for a savings of up to $26 million in the Education Fund that he began demanding from lawmakers in mid-April. Scott wants to capture savings from new health care plans that will be offered to all Vermont teachers in January that will have lower premiums but higher out-of-pocket costs.

The governor has maintained that the higher out-of-pocket costs can be covered with the $75 million in projected premiums savings, leaving up to $26 million leftover. The savings is contingent on teachers paying for at least 20 percent of the premiums.

The governor and Democrats that lead both the House and Senate had significant disagreements about how to achieve the savings. The governor’s approach, according to the Democrats, would infringe on the collective bargaining rights of teachers.

Johnson sidestepped a question about whether the agreement tinkers with the collective bargaining process for teachers.

“We feel like every side has given up a bunch. It’s been very respectful and we’ve made kind of as few changes as we can because it’s so last minute,” she said.

Meanwhile, House Minority Leader Don Turner, R-Milton, said the 53-member Republican caucus was prepared to suspend rules Wednesday to expedite passage of a new budget, which will also include the yield bill that sets property tax rates.

“We’ve got to suspend the rules. No matter what happens it’s going to take a rules suspension by us to make this happen,” Turner said. “As long as there is a compromise we’re going to vote to suspend the rules to bring up a new bill.”

The veto session is scheduled for two days, but Turner said there is “no reason” to come back Thursday if an agreement is in place. Turner said he was also awaiting a detailed explanation of the agreement that Johnson, Ashe and the governor were close to finalizing.

Rep. Don Turner

Turner said he preferred the governor’s original plan but is willing to vote in favor of a compromise that achieves some of the savings the governor is seeking.

“I think back to when we started talking about this, we would have loved to save all the money for the taxpayers in Vermont. But, this is a compromise. I haven’t gotten all the details. I don’t know what they are. It’s a compromise that everybody worked hard on. I don’t think anybody is going to be ecstatic,” he said. “I can sense nobody is really jumping for joy. I think that usually means it’s a good compromise and we’ll continue working on it.”

Lawmakers may also consider a new marijuana legalization bill to replace S.22, which Scott vetoed last month. The bill sought to legalize the possession of up to 1 ounce of dry marijuana, two mature marijuana plants and two immature plants. Scott vetoed the bill with several concerns, including road safety and the makeup and timeline of a commission included in the bill that will recommend legislation for a tax-and-regulate marijuana market in the state.

Key lawmakers and the governor were working toward a revised compromise bill Tuesday, but passing the bill will require a rules suspension. Turner said House Republicans are unlikely to support that.

“I don’t think it changes many of our caucus members’ feelings on marijuana. There’s a whole other session to go. January is not that far away now and it can go through the entire process. We’ll bring it up in caucus … and if the caucus members vote to suspend the rules we’ll do it. With only three people supporting the marijuana bill in our caucus, I think that’s a big stretch,” he said.

In his veto message to lawmakers, Scott said he would support passage of a new marijuana legalization bill if his concerns were addressed. Sen. Dick Sears, D-Bennington, the chairman of the Senate Judiciary Committee, said negotiations were ongoing Tuesday. But passing a new bill will require work from the governor to convince the House GOP caucus to suspend rules.

“I say it’s 50-50 that we come to an agreement, and then if we do, I’d say it’s unlikely we’d get a suspension of the rules unless the governor is willing to get out there and ask Republicans in the House to suspend the rules,” Sears said.

Lawmakers are expected to gavel in at 10 a.m. Wednesday to hold constitutionally-required override votes for all three vetoes. All three override votes are expected to fail.

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